We began the process of evaluating companies for The 2017 CBE Ancillary Business 150 back in May, using CBE Week to get the message out to its 30,000 plus subscribers that included a brief survey tracking company revenue performance for the last three years, as well as other proprietary information.
CBE then pursued companies that we thought should be included in this year’s list by speaking with companies directly that exhibit at industry trade shows throughout the summer, and then with yours truly, reaching out directly to company ownership via e-mails and phone calls to gather the data needed to put together this year’s ranking.
For those of you who are new to CBE and our industry lists, when we launched in November of 2014, CBE promised its readers that it was on a mission to share the best practices of key industry stakeholders, and benchmark and recognize performance of private companies, by sharing their revenue, employee counts and key management players.
The goal of this list has always been to help buyers and sellers in the industry connect, and help the network of key industry political, regulatory and special interest group leaders to stay on top of developments that impact their business decisions.
When reaching out to ancillary business executives, my pitch was very simple: “You want to be included in the AB list because it really is a list of product and service suppliers that are generating real revenues and employing real paid workers, which are the best indicators of why you should be on an RFP when a licensee is looking for your category of product or service providers.”
And, just as importantly, transparency says a lot about companies that are working diligently to build successful ventures – a lot more than the amount of capital companies raise with an idea and a promise of great returns to investors looking to maximize returns based on “shoot for the moon” valuations. This was a lesson learned in past boom and busts, like the rise and fall of thousands of internet start-up companies in the late 1990’s and early 2000’s, or the implosion of the banking and mortgage sector ten short years ago.
And yes, whether I am specifically being naive or not, my personal aspiration was to see capital flow to the start-ups whose products or services could solve cannabis licensee business problems – or to cannabis licensees like the ones on the 2017 CBE 200 PPRs and other companies that we haven’t identified yet (not for a lack of trying).
As usual, please reach out to CBE and feel free to submit a completed survey so we can recognize other companies that we didn’t identify on this year’s list. We want licensees to know about and have access to all of the terrific suppliers!
Some of my favorite stories (actually least favorite) and comments in putting together this list together were the ones I heard when talking to executives, who are not as transparent as I hope they would be, or are so focused on their valuations that they lose track of the fact that they better deliver for customers before counting their potential wealth – that includes companies that I have called repeatedly only to get screened out and never acknowledged (I should publish that list!). Those stories include:
1.) “What does it cost to be on your list?” (There are way too many pay-for-play media pretenders in the cannabis space. CBE is not one of them!).
2.) “Your list should be based on valuations.” (Ahh I see…potential and big ideas count more than real performance.).
3.) “He or she is on a call and will get back to you shortly.” (The absolute kiss off!).
4.) “What is in it for me and my company to be on your list?”
5.) “The competitive comment of XYZ company’s past year revenues aren’t counted correctly.” (Instead of focusing on why their company should be on the list).
6.) “I don’t want to be on your list because….” (Like Forbes, Fortune or Business Week, CBE is an editorial product and its editors decide who is on the list!).
But enough with this editor’s venting about the difficulties associated with this task. Let’s look at the criteria for inclusion.
The 2017 CBE Ancillary Business List was expanded to include all categories of businesses that are part of CBE’s Business Directory, which includes over 750 companies. The projected year-end annual revenue threshold for being part of the rankings this year is at least $1,000,000.
CBE received over 150 completed surveys. Some of the companies that submitted did not qualify for the 2017 list but are now part of the ever-growing database that CBE has been collecting for the past three years.
The top categories of representation on this year’s list are:
|Cultivation Products & Services||33|
|Lab Testing/Media & Publishing||14|
Notably absent from this year’s list are biotechnology companies. CBE only had a couple of firms submit surveys and none qualified.
A list of the top-ranked companies by category and by reported projected year-end revenues looks like this:
|Advertising, Marketing and PR||The Cannabis Marketing Lab|
|Consumption Gear & Supplies||VapeWorld|
|Cultivation Products & Services||Hawthorne Garden Products|
|Extraction/Distillation Equipment||Waters Corporation|
|Lab Testing||CW Analytical|
|Packaging||Cool Jarz (Earthwise Packaging)|
|Security Solutions||CannaGuard Security|
|Staffing/Payroll||Ms. Mary Staffing|
On behalf of CBE Press, congratulations to Chris Hagedorn and his top ranked team at Hawthorne Garden Supplies, owners of well-known brands Gavita lighting, Botanicare and General Hydroponics.
Also, a shout out to Doug Francis and his team at Weedmaps. CBE’s sources tell us that their revenue grew by leaps and bounds in the last year, as their international expansion gains ground and traction.
Finally, thank you to all of the companies that shared their proprietary data and keep it coming so we can keep up with the ever-growing CBE Producer, Processor and Retailer list that included 200 companies this year.